New-vehicle retail sales in May are projected to reach 1.2 million vehicles, representing a seasonally adjusted annualized rate (SAAR) of 12.5 million units. May is the third consecutive month retail sales have exceeded 1 million units, according to J.D. Power and LMC Automotive.
“This is the time of year when the automotive industry holds its collective breath as the recent past has dealt with a spring slowdown in demand; however, the current pace suggests full steam ahead for the second half of 2013,” said Jeff Schuster, senior vice president of forecasting at LMC Automotive. “Economic and market headwinds have been minimized, while demand continues to build momentum.”
According to the monthly sales forecast, the May new-vehicle retail selling rate is expected to be 1 million units stronger than a year ago. Light-vehicles sales are expected to be up 8 percent from May 2012 at 1.4 million. Strong demand for full-sized pickups accounted for 11.4 percent of industry retail sales, up 9.7 percent from May 2012.
The average transaction price for all new vehicles so far in May is $28,921, the highest ever for the month of May and 3 percent higher than May 2012. Low interest rates, the use of extended-term vehicle loans, robust used-vehicle sales and demand for full-sized pickups is helping industry average transaction prices reach record levels, according to J.D. Power and LMC Automotive.
“This market dynamic is enabling consumers to purchase new vehicles with improved fuel economy, safety and technology at an affordable monthly payment,” said John Humphrey, senior vice president of global automotive practice at J.D. Power.
LMC Automotive predicts total light-vehicle sales for 2013 will reach 15.4 million units and retail light-vehicle sales will reach 12.5 million units.